Strong Entertainment(SGE) - 2024 Q1 - Quarterly Results

Revenue and Profitability - Revenue increased by 11.2% to $11.1 million in Q1 2024, up from $10.0 million in Q1 2023, driven by higher sales of projection screens and equipment[6] - Gross profit margin improved to 24.0% of revenue in Q1 2024, compared to 23.3% in the prior year, with gross profit rising to $2.7 million from $2.3 million[6] - Income from operations decreased to $0.2 million in Q1 2024 from $0.5 million in Q1 2023, impacted by higher general and administrative expenses[6] - Net income from continuing operations was $0.1 million in Q1 2024, down from $0.6 million in Q1 2023[6] - Adjusted EBITDA decreased to $0.4 million in Q1 2024 from $0.8 million in the prior year, primarily due to increased general and administrative costs[6] - Net income from continuing operations for Q1 2024 was $119,000, a decrease of 78.9% compared to $564,000 in Q1 2023[21] - Adjusted EBITDA for Q1 2024 was $409,000, down 45.8% from $755,000 in Q1 2023[22] - The company reported a net loss of $73,000 for Q1 2024, compared to a net income of $373,000 in Q1 2023[22] Cash Flow and Assets - Cash and cash equivalents decreased to $5.1 million as of March 31, 2024, from $5.5 million at the end of 2023[18] - Total assets decreased to $25.3 million as of March 31, 2024, down from $26.5 million at the end of 2023[18] - Cash flows from operating activities from continuing operations generated $235,000, a decline of 81.7% from $1,283,000 in the same period last year[21] - Total cash and cash equivalents at the end of Q1 2024 were $5,111,000, an increase from $4,077,000 at the end of Q1 2023[21] - The provision for warranty decreased to $10,000 in Q1 2024 from $44,000 in Q1 2023[21] - Capital expenditures for Q1 2024 were $22,000, a reduction from $75,000 in Q1 2023[21] - Net cash used in investing activities for Q1 2024 was $22,000, down from $158,000 in Q1 2023[21] Strategic Developments - The ICS acquisition contributed positively to revenue growth and is expected to enhance service business scale[4] - Strong Global Entertainment announced a merger with FG Acquisition Corp. valuing Strong/MDI at $30 million, retaining a significant economic stake[6] - The company anticipates that the upgrade activity in the cinema industry will serve as a multi-year growth catalyst[6] Foreign Currency and Borrowings - The company experienced a foreign currency transaction loss of $162,000 in Q1 2024, compared to a loss of $117,000 in Q1 2023[22] - The company had borrowings under credit facility amounting to $2,839,000 in Q1 2024, compared to $1,596,000 in Q1 2023[21]